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How NYC Local Law 144 is already influential

NYC Local Law 144 is the first law that will be regulating algorithmic tools used in the employment process, what the law calls “automated employment decision tools” (AEDT). It will begin enforcement July 5th, 2023. Other laws like it have already sprung up, some using the exact same terminology and mechanisms.

Experts expect that this law will have far reaching influence as more and more governments aim to tackle the harms that new artificial intelligence and machine learning tools may cause. NYC Local Law 144 is specifically aimed to reduce gender and racial bias that these tools may bring. Other emerging laws are indicating that they will broaden that scope.

Below are a couple of examples of this influence.

New Jersey Assembly Bill 4909

This bill borrows the same definition from NYC Local Law 144 for AEDT, however it puts the onus of independent bias audits on the tool vendor as opposed to the employer using it. It also requires employers to provide notice to applicants that automated tools will be used.

Even the fines are the same – $500 to $1500 per day, per violation.

NJ A4909 was approved by the Assembly Labor Committee with an 8-1 vote, and referred to the Assembly Science, Innovation and Technology Committee. So there is still a way for this bill to go before it could go into law.

Interesting pieces of this bill include the mandate for an annual audit supplied by the vendor at no additional cost to the businesses using the tool, a seemingly narrower scope for the stage these tools are used (only focuses on applicants), and a potentially broader scope for those impacted (mentions laws against discrimination, which include more covered groups than gender and race).

Full text of the bill can be found here.

New York State Assembly Bill A00567

This bill also uses the definition of AEDT from NYC Local Law 144, however it defines it more broadly to include any tool that produces a preferred candidate. Of note, the need for providing notice to applicants is absent from this bill.

In addition, the “bias audit” is termed as “disparate impact analysis” in this bill, though they essentially perform the same function and purpose.

The bill has been referred to the Standard Committee on Labor and is very early on in the process. You can find the full text of the bill here.

John Rood

John is a sought-after expert on emerging compliance issues related to AI in hiring and HR. He has spoken at the national SHRM conference, and his writing has appeared in HR Brew, Tech Target, and other publications. Prior to Proceptual, John was founder at Next Step Test Preparation, which became a leader in the pre-medical test preparation industry before selling to private equity. He lives in the Chicago area and is a graduate of Michigan State University and the University of Chicago.